Corporate sustainability reporting requires sophisticated tools

Companies are increasingly tracking, reporting and striving to meet corporate sustainability goals, but once the simpler achievements have been made, further improvements require sophisticated tools, according to a report from Lux Research.

“Eventually, the need to track, report and optimise resource utilisation will become core to every business, moving sustainability from a ‘nice to have‘ to being central to the assessment of financial performance and resilience strategy,” said Ryan Dolen, Lux Research Data Scientist, and a co-author of the report titled, “A Data-driven Approach to Sustainability Benchmarking.”

“Whether applied to emissions for concrete and cement companies or water for food and beverage companies, gathering and acting on better geospatial and temporal data will be a corporate differentiator,” he added.

Lux has developed a Grid Networks Analytics (GNA) tool that assimilates and analyses public grid-based electricity generation and exchange datasets that have previously been disconnected and underutilised. The report also examines the evolution of sustainability reporting and its impact on industries such as cement and food and beverage. Lux found that reporting, though on the rise, is not yet thorough. The number of companies reporting to the Carbon Disclosure Project has boomed from just 253 in 2003 to over 5000 in 2014. However, while 90% of reporting firms had complete data on electricity and greenhouse gas (GHG) emissions, only 10% reported well on water. Consistent measurement is the first step towards benchmarking and improving, and the gap between leaders and laggards is wide.

The report also found that impact analysis is improved. With better analytical tools, cost-effective decisions are enabled. Geospatial analysis enables a more precise measurement of CO2 impact. An emissions impact analysis using Lux GNA of a solar project installation decision for US cement production facilities revealed that Holcim could have reduced emissions more than 50% further had it chosen the Ste. Genevieve, MO, location, rather than Fountain, CO, for its 156 MWh/year solar PV installation.

Also among the report’s findings was the improvement in action on the energy-water nexus. Manufacturing operations thrive and survive on the basis of consistent, resilient and cost-effective energy and water availability. Moving forward, the energy footprint of water used will also come into focus, a metric that will vary greatly by location based on Lux’s geospatial analysis.

The report is part of the Lux Research Sustainable Building Materials Intelligence service and the Lux Research Analytics team.